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Feb 26, 2007 - 12:00 PM

In Insurance Companies We Trust

by Judy Dugan
During his news conference at the National Press Club (get webcast here) in Washington Monday, the Gov fielded lots of softballs from the smitten D.C. press corps. He also dodged one hardball from the C-Span moderator, asking whether as part of his health reform he'd regulate health insurance rates in the same way that auto insurance rates are successfully regulated in California.

His response: Well, maybe, "if there's a big problem" later. He said he believed that requiring everyone to buy insurance on the private market would reduce the cost of health insurance premiums, currently averaging about $11,500 a year for a family of four.

Then, the tipoff: "You must let everyone make their profits," he declared.

Come again? It's insurance companies' bloated overhead and record profits that are the biggest driver of health care cost increases. Of course, part of that bloat comes from the $3.5 million the health industry has contributed to Arnold's political campaigns.

"Everyone" obviously doesn't include Californians who have to foot the health insurance bill. Requiring all to buy such insurance, without any cap on what insurers and HMOs can charge, any floor on how little they cover and no need for the industry to publicly justify what it charges, is a recipe only for profits -- not affordability.

Trusting the medical/insurance industry to cut prices and accept lower profits is like trusting oil companies to stop gouging drivers on gasoline prices -- except that people can take public transit without risking their lives or courting medical bankruptcy.

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